[Federal Register Volume 85, Number 10 (Wednesday, January 15, 2020)]
[Rules and Regulations]
[Pages 2279-2281]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00479]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 85, No. 10 / Wednesday, January 15, 2020 /
Rules and Regulations
[[Page 2279]]
OFFICE OF GOVERNMENT ETHICS
5 CFR Parts 2634 and 2636
RIN 3209-AA49
2020 Civil Monetary Penalties Inflation Adjustments for Ethics in
Government Act Violations
AGENCY: Office of Government Ethics.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In accordance with the Federal Civil Penalties Inflation
Adjustment Act Improvements Act of 2015, the U.S. Office of Government
Ethics is issuing this final rule to make the 2020 annual adjustments
to the Ethics in Government Act civil monetary penalties.
DATES: This final rule is effective January 15, 2020.
FOR FURTHER INFORMATION CONTACT: Kimberly L. Sikora Panza, Associate
Counsel, General Counsel and Legal Policy Division, Office of
Government Ethics, Telephone: 202-482-9300; TTY: 800-877-8339; FAX:
202-482-9237.
SUPPLEMENTARY INFORMATION:
I. Background
In November 2015, Congress passed the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015 (Sec. 701 of Pub. L.
114-74) (the 2015 Act), which further amended the Federal Civil
Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410). The 2015
Act required Federal agencies to make inflationary adjustments to the
civil monetary penalties (CMPs) within their jurisdiction with an
initial ``catch-up'' adjustment through an interim final rule effective
no later than August 1, 2016, and further mandates that Federal
agencies make subsequent annual inflationary adjustments of their CMPs,
to be effective no later than January 15 of each year.
The Ethics in Government Act of 1978 as amended, 5 U.S.C. appendix
(the Ethics Act) provides for five CMPs.\1\ Specifically, the Ethics
Act provides for penalties that can be assessed by an appropriate
United States district court, based upon a civil action brought by the
Department of Justice, for the following five types of violations:
---------------------------------------------------------------------------
\1\ OGE has previously determined, after consultation with the
Department of Justice, that the $200 late filing fee for public
financial disclosure reports that are more than 30 days overdue (see
section 104(d) of the Ethics Act, 5 U.S.C. appendix, 104(d), and 5
CFR 2634.704 of OGE's regulations thereunder) is not a CMP as
defined under the Federal Civil Penalties Inflation Adjustment Act,
as amended. Therefore, that fee is not being adjusted in this
rulemaking (nor was it adjusted by OGE in previous CMP rulemakings),
and will remain at its current amount of $200.
---------------------------------------------------------------------------
(1) Knowing and willful failure to file, report required
information on, or falsification of a public financial disclosure
report, 5 U.S.C. appendix 104(a), 5 CFR 2634.701(b);
(2) knowing and willful breach of a qualified trust by trustees and
interested parties, 5 U.S.C. appendix 102(f)(6)(C)(i), 5 CFR
2634.702(a);
(3) negligent breach of a qualified trust by trustees and
interested parties, 5 U.S.C. appendix 102(f)(6)(C)(ii), 5 CFR
2634.702(b);
(4) misuse of a public report, 5 U.S.C. appendix 105(c)(2), 5 CFR
2634.703; and
(5) violation of outside employment/activities provisions, 5 U.S.C.
appendix 504(a), 5 CFR 2636.104(a).
In compliance with the 2015 Act and guidance issued by the Office
of Management and Budget (OMB), the U.S. Office of Government Ethics
(OGE) made previous inflationary adjustments to the five Ethics Act
CMPs, and is issuing this rulemaking to effectuate the 2020 annual
inflationary adjustments to those CMPs. In accordance with the 2015
Act, these adjustments are based on the percent change between the
Consumer Price Index for all Urban Consumers (CPI-U) for the month of
October preceding the date of the adjustment, and the prior year's
October CPI-U. Pursuant to OMB guidance, the cost-of-living adjustment
multiplier for 2020, based on the CPI-U for October 2019, not
seasonally adjusted, is 1.01764. To calculate the 2020 annual
adjustment, agencies must multiply the most recent penalty by the
1.01764 multiplier, and round to the nearest dollar.
Applying the formula established by the 2015 Act and OMB guidance,
OGE is amending the Ethics Act CMPs through this rulemaking to:
(1) Increase the three penalties reflected in 5 CFR 2634.702(a), 5
CFR 2634.703, and 5 CFR 2636.104(a)--which were previously adjusted to
a maximum of $20,134--to a maximum of $20,489;
(2) Increase the penalty reflected in 5 CFR 2634.702(b)--which was
previously adjusted to a maximum of $10,067--to a maximum of $10,245;
and
(3) Increase the penalty reflected in 5 CFR 2634.701(b)--which was
previously adjusted to a maximum of $60,517--to a maximum of $61,585.
These adjusted penalty amounts will apply to penalties assessed after
January 15, 2020 (the effective date of this final rule) whose
associated violations occurred after November 2, 2015.
OGE will continue to make future annual inflationary adjustments to
the Ethics Act CMPs in accordance with the statutory formula set forth
in the 2015 Act and OMB guidance.
II. Matters of Regulatory Procedure
Administrative Procedure Act
Pursuant to 5 U.S.C. 553(b), as Director of the Office of
Government Ethics, I find that good cause exists for waiving the
general notice of proposed rulemaking and public comment procedures as
to these technical amendments. The notice and comment procedures are
being waived because these amendments, which concern matters of agency
organization, procedure and practice, are being adopted in accordance
with statutorily mandated inflation adjustment procedures of the 2015
Act, which specifies that agencies shall adjust civil monetary
penalties notwithstanding Section 553 of the Administrative Procedure
Act. It is also in the public interest that the adjusted rates for
civil monetary penalties under the Ethics in Government Act become
effective as soon as possible in order to maintain their deterrent
effect.
Regulatory Flexibility Act
As the Director of the Office of Government Ethics, I certify under
the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this final
rule would not have a significant economic impact on a substantial
number of small entities because it primarily affects current Federal
executive branch employees.
[[Page 2280]]
Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply
because this regulation does not contain information collection
requirements that require approval of the Office of Management and
Budget.
Unfunded Mandates Reform Act
For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
chapter 5, subchapter II), this rule would not significantly or
uniquely affect small governments and will not result in increased
expenditures by State, local, and tribal governments, in the aggregate,
or by the private sector, of $100 million or more (as adjusted for
inflation) in any one year.
Executive Order 13563 and Executive Order 12866
Executive Orders 13563 and 12866 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select the regulatory approaches that
maximize net benefits (including economic, environmental, public health
and safety effects, distributive impacts, and equity). Executive Order
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
The Office of Management and Budget has determined that rulemakings
such as this implementing annual inflationary adjustments under the
2015 Act are not significant regulatory actions under Executive Order
12866.
Executive Order 12988
As Director of the Office of Government Ethics, I have reviewed
this rule in light of section 3 of Executive Order 12988, Civil Justice
Reform, and certify that it meets the applicable standards provided
therein.
List of Subjects
5 CFR Part 2634
Certificates of divestiture, Conflict of interests, Financial
disclosure, Government employees, Penalties, Privacy, Reporting and
recordkeeping requirements, Trusts and trustees.
5 CFR Part 2636
Conflict of interests, Government employees, Penalties.
Dated: January 9, 2020.
Emory Rounds,
Director, U.S. Office of Government Ethics.
For the reasons set forth in the preamble, the U.S. Office of
Government Ethics is amending 5 CFR parts 2634 and 2636 as follows:
PART 2634--EXECUTIVE BRANCH FINANCIAL DISCLOSURE, QUALIFIED TRUSTS,
AND CERTIFICATES OF DIVESTITURE
0
1. The authority citation for part 2634 continues to read as follows:
Authority: 5 U.S.C. app.; 26 U.S.C. 1043; Pub. L. 101-410, 104
Stat. 890, 28 U.S.C. 2461 note, as amended by Sec. 31001, Pub. L.
104-134, 110 Stat. 1321 and Sec. 701, Pub. L. 114-74; Pub. L. 112-
105, 126 Stat. 291; E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p.
215, as modified by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p.
306.
0
2. Section 2634.701 is amended by revising paragraph (b) to read as
follows:
Sec. 2634.701 Failure to file or falsifying reports.
* * * * *
(b) Civil action. The Attorney General may bring a civil action in
any appropriate United States district court against any individual who
knowingly and willfully falsifies or who knowingly and willfully fails
to file or report any information required by filers of public reports
under subpart B of this part. The court in which the action is brought
may assess against the individual a civil monetary penalty in any
amount, not to exceed the amounts set forth in Table 1 to this section,
as provided by section 104(a) of the Act, as amended, and as adjusted
in accordance with the inflation adjustment procedures prescribed in
the Federal Civil Penalties Inflation Adjustment Act of 1990, as
amended.
Table 1 to Sec. 2634.701
------------------------------------------------------------------------
Date of violation Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 14, 2007 and Nov. 2, $50,000
2015...................................................
Violation occurring after Nov. 2, 2015.................. 61,585
------------------------------------------------------------------------
* * * * *
0
3. Section 2634.702 is revised to read as follows:
Sec. 2634.702 Breaches by trust fiduciaries and interested parties.
(a) The Attorney General may bring a civil action in any
appropriate United States district court against any individual who
knowingly and willfully violates the provisions of Sec. 2634.408(d)(1)
or (e)(1). The court in which the action is brought may assess against
the individual a civil monetary penalty in any amount, not to exceed
the amounts set forth in Table 1 to this section, as provided by
section 102(f)(6)(C)(i) of the Act and as adjusted in accordance with
the inflation adjustment procedures prescribed in the Federal Civil
Penalties Inflation Adjustment Act of 1990, as amended.
Table 1 to Sec. 2634.702
------------------------------------------------------------------------
Date of violation Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, $11,000
2015...................................................
Violation occurring after Nov. 2, 2015.................. 20,489
------------------------------------------------------------------------
(b) The Attorney General may bring a civil action in any
appropriate United States district court against any individual who
negligently violates the provisions of Sec. 2634.408(d)(1) or (e)(1).
The court in which the action is brought may assess against the
individual a civil monetary penalty in any amount, not to exceed the
amounts set forth in Table 2 to this section, as provided by section
102(f)(6)(C)(ii) of the Act and as adjusted in accordance with the
inflation adjustment procedures of the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended.
Table 2 to Sec. 2634.702
------------------------------------------------------------------------
Date of violation Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, $5,500
2015...................................................
Violation occurring after Nov. 2, 2015.................. 10,245
------------------------------------------------------------------------
0
4. Section 2634.703 is revised to read as follows:
Sec. 2634.703 Misuse of public reports.
(a) The Attorney General may bring a civil action against any
person who obtains or uses a report filed under this part for any
purpose prohibited by section 105(c)(1) of the Act, as incorporated in
Sec. 2634.603(f). The court in which the action is brought may assess
against the person a civil monetary penalty in any amount, not to
exceed the amounts set forth in Table 1 to this section, as provided by
section 105(c)(2) of the Act and as adjusted in accordance with the
inflation adjustment procedures prescribed in the Federal Civil
Penalties Inflation Adjustment Act of 1990, as amended.
Table 1 to Sec. 2634.703
------------------------------------------------------------------------
Date of violation Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, $11,000
2015...................................................
[[Page 2281]]
Violation occurring after Nov. 2, 2015.................. 20,489
------------------------------------------------------------------------
(b) This remedy shall be in addition to any other remedy available
under statutory or common law.
PART 2636--LIMITATIONS ON OUTSIDE EARNED INCOME, EMPLOYMENT AND
AFFILIATIONS FOR CERTAIN NONCAREER EMPLOYEES
0
5. The authority citation for part 2636 continues to read as follows:
Authority: 5 U.S.C. App. (Ethics in Government Act of 1978);
Pub. L. 101-410, 104 Stat. 890, 28 U.S.C. 2461 note (Federal Civil
Penalties Inflation Adjustment Act of 1990), as amended by Sec.
31001, Pub. L. 104-134, 110 Stat. 1321 (Debt Collection Improvement
Act of 1996) and Sec. 701, Pub. L. 114-74 (Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015); E.O. 12674, 54
FR 15159, 3 CFR, 1989 Comp., p. 215, as modified by E.O. 12731, 55
FR 42547, 3 CFR, 1990 Comp., p. 306.
0
6. Section 2636.104 is amended by revising paragraph (a) to read as
follows:
Sec. 2636.104 Civil, disciplinary and other action.
(a) Civil action. Except when the employee engages in conduct in
good faith reliance upon an advisory opinion issued under Sec.
2636.103, an employee who engages in any conduct in violation of the
prohibitions, limitations and restrictions contained in this part may
be subject to civil action under 5 U.S.C. app. 504(a) and a civil
monetary penalty of not more than the amounts set in Table 1 to this
section, as adjusted in accordance with the inflation adjustment
procedures prescribed in the Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended, or the amount of the compensation
the individual received for the prohibited conduct, whichever is
greater.
Table 1 to Sec. 2636.104
------------------------------------------------------------------------
Date of violation Penalty
------------------------------------------------------------------------
Violation occurring between Sept. 29, 1999 and Nov. 2, $11,000
2015...................................................
Violation occurring after Nov. 2, 2015.................. 20,489
------------------------------------------------------------------------
* * * * *
[FR Doc. 2020-00479 Filed 1-14-20; 8:45 am]
BILLING CODE 6345-03-P